This is a specious argument. The only economies greater than 5 trillion besides the prc are the American and Japanese economy . The American gdp crossed 5 trillion in 1988 . 5 trillion in those days had a lot more value than 5 trillion these days. The American people in those days were the most prosperous in the world. The unemp rate was about 5 % . The per capita owner ship of gadgets and luxury products was the highest. The Japs have been vacillating the 5 trillion mark for the pas decade and a half.
Americans are still the most prosperous in the world, the recent recession notwithstanding. Japan is still the wealthiest nation in Asia, the last decade of stagnation notwithstanding.
It is not possible to grow continuously. But the best and most stable economies, invariably free-market democracies, will grow over time on an upward slope. It's like traversing a mountain. There will be dips and rises but the general direction is up over time.
1) A population that is saturated with all goodies
Populations can be saturated with the goodies that are currently most in production. But there are lots of things that even Americans will want in the future or even the present.
Now true, if the things they want are not yet in the factories providing the bulk of employment, it will not help the economic picture that much.
But once production catches up with demand, then it will create a new dynamic for the economy.
In the US, they look towards innovation. Inventing new things that people might want. Personal computers were a market created out of nothing by Americans. Before the 1970s, there was no such industry that now provide jobs around the world including the US.
The same with the television before the 1950s, the microwave oven before the 1980s or the handheld before the 1990s.
It is not possible to grow indefinitely . Japan grew till it had a per capita income of close to 40K dollars . Than it stopped growing . Euro economies too faced great resistance to growth once they reached that figure . I believe that their will be an upper limit per capita income up to which a country may grow due to limited nature of resources , stabilization of demand in a rich economy and the limited speed of innovation.
You mean it is not possible to grow at a high rate indefinitely. It is necessary to grow indefinitely unless you believe in complete stagnation at some point in human history when every nation had caught up.
No, I believe that humans will continue to get wealthier until they run completely out of resources on earth but then there is the universe, no?
Where the chinese have blundered is there attempt to ape the developed economy in every aspect. Their growth is primarily investment driven (ie dependant upon increase in production capacity) rather than demand driven.
No the Chinese did not ape a developed economy, if they did they would had put in a free market and a free form of government. Developed economies are entirely market driven and operate under a democracy.
Backward communist/socialist economies like China are investment driven. It doesn't matter if it was the USSR or Cuba, N. Korea, West Bengal or China today.
What China has today is what it had for the past 60 years. What is different with China as opposed to a Cuba or N. Korea is its willingness to accept FDI and the availability of the non-resident Chinese to provide funds.
It is impossible for China to have a demand driven economy as it is communist. Its form of government makes sure that it is inefficient and fueled by state funded investment. They were smart enough to use foreign investment when they can get it. But by nature a communist nation is an state investment driven economy.
And attempting to make the transition would result in long periods of turmoil. They have a bubble at the stage of development wherein they simply cannot afford to have one.
Why is a bubble in this stage any worse than any other? In fact, it is better to have it at this stage than to have it when they were three times poorer in the 1990s.
Again, it is like people feeling "sorry" for the US since the 2008 recession and for Japan mired in its decade-long stagnation. But before hitting those roadblocks, they've already made themselves into the wealthiest nations on earth.
One thing with China in the modern era is they create seemingly disastrous situations -- the one in the 1990s with all four of their largest banks insolvent was worse than anything that could happen today -- and then clear everything away by making the whole nation eat the loses, which means that everyone takes a small hit, and then power on from there.
But the fact that the CCP can hang on gives me great hope that they can weigh China down with their inefficiencies for decades to come.
And the one child norm was the most idiotic and barbaric thing they ever did.
Thank goodness for the CCP. The truth is I can not abide another billion chinamen in the world. I say that that even though my wife is Chinese-American. Or maybe it is because of that and I have to live with the in-laws. I jest! (In case, she ever reads this.)
Stupidity and inhumanity are the hallmarks of communism. You can expect no less. As a rival civilization, you can only hope that your main rival is governed as a People's Republic.
They ll have the demographics of a developed country before they actually develop. They ll have the disadvantages of a developed country before they truly can develop.
Actually, there is no such thing as "disadvantages" of a developed country. By definition, a developed nation has advantages. In general, a smaller population allows for far better living standards. An older population produces less crime and is less prone to revolt. The only problem is welfare. And welfare is only a problem if you are humane. If you are the Chinese communist party, you have no problem. China doesn't have social security. They are perfectly willing to let them fend for themselves. Old people are also easy to cow by the state police force.
But in the end, communism as evident in Eastern Europe and the USSR creates both a stagnant population and a stagnant economy. It can operate for years in this state.